Paid Social vs. Digital Display: Which is the Better Choice?

by Andrew Krebs-Smith | October 16

Marketers’ feet are being held to the fire. Brands are demanding hard data with which to quantify the value of their advertising spend. If you are relying on digital display advertising to drive sales or customer acquisition, you are working at a data disadvantage – and you’re probably getting burned.

Why? Because of the “display advertising ecosystem.” In that ecosystem, many layers of specialization lie between you and your audience, and that structure makes it impossible to accurately measure what is driving success and what is wasting your money.

Think of it as an ad delivery supply chain that looks something like this: An advertiser builds creative, which will then be uploaded to a DSP, who buys according to rules that were set up that the beginning of the campaign. On the website publisher’s side, sell-side platform specialists work with ad networks and trading desks, who get your content to the publishers. Each link in that chain has a critical and highly specialized role to play in getting your message in front of an audience. It also represents a business that must make money for itself. That money comes from your advertising budget in the form of margin. (Ask yourself now if you have clarity on the amount of margin each link in your chain is taking.)

The display ad ecosystem creates three major headaches for marketers who need to prove the worth of their spend:

There is an inherent lack of useful data in display advertising.

Think about the way you consume information on a website. In the vast majority of cases, you do not have to log-in to read an article online, so there is no personally identifying information that associates you with your ad view. It is true that some website publishers collect data, and it’s also true that many don’t. Even when publishers do collect data, aggregating it usefully from multiple publishers is impossible. They all collect different data sets and most are limited to very broad demographic categories.

There is a latency problem.

Before it can be reported to you, the limited data the ecosystem offers has to filter back up through the links in the supply chain. By the time it gets to you, it’s too late to be useful for making changes that drive more efficient conversion. In the old days, running a campaign based on insertion orders made sense—but things move so quickly in digital that you need to be giving guidance in real time to protect ROI. A more sensible way to structure the spend would be to give the agency a portion of the budget, and then measure and test results before giving them the rest, but that is not the way insertions orders work. Once you sign away your budget, it is going to be spent the way the specialists determine.

You have no transparency into your spend, no ability to know specifically who sees what ad.

Is an “impression” male or female, married or single, a parent, a kite enthusiast, or whatever? Hard to know. Even true experts in display advertising are limited by the data that the ecosystem’s structure allows them to see. Relying on third party market research or someone’s set of best practices won’t give you clarity on what is driving your results. It comes down to guesswork.

While there is no question that display advertising (and print, television and all the other channels appropriate to your business) is a necessary part of the mix, that can’t be your main strategy. Not when it’s possible to have all the clarity you need.

We recommend that paid social come first—it should be the channel through which you launch campaigns and build out your acquisition strategy. Social should come first because it (and only it) can deliver the hard data you need to determine where, when and how to focus your spend in any other channel.

Using Facebook, for instance, the person who runs your campaigns performs all of the functions of the whole group of specialists in the display ad ecosystem—that’s one big reason that paid social is less expensive, too. On a platform like Facebook or LinkedIn, the quantity and quality of data they collect gives you tremendous advantages. You’ll not only know exactly who saw your ad (including all the traditional demographic data), but also, you’ll have a razor sharp sense of what interests them, and therefore what moves them. With such granular data, you can segment that audience into virtually unlimited number of sub-groups, enabling you to test messages, learn what motivates them, adjust spend and creative in real time, and finally track them to point of conversion. When you know who your audience is, where they are, and how best to get to them, you can make confident, credible decisions across multiple channels.

The paid social world is increasingly complex. Deep expertise really does matter here. If you have 100 audience segments, each with 10 sub-segments, you need a way to integrate the data and pull the right levers at the right time to be successful. Finding a partner who can help you structure, sort and flex your spend to its best advantage is key.

If you’ve never worked with a paid social expert, we’ll be happy to answer any questions in the comments below.

About the author

Andrew Krebs-Smith

Andrew sings our praises to anyone that will listen. Before founding Social Fulcrum, he developed and managed social media strategy for accounts including Pfizer, Ocean City MD, The National Aquarium, and Strayer University. Andrew loves food, travel, music, exercise, and tea. Connect with Andrew on Twitter and LinkedIn.